A more influential Europe needs a strong and active common foreign and security policy, which in turn demands a more competitive and efficient defence and security sector.

The successive waves of cuts in defence budgets and the persisting fragmentation of defence markets in Europe threaten Europe’s capacity to sustain effective defence capabilities and a competitive defence industry. This also jeopardises Europe’s capacity to meet the new security challenges in an autonomous and effective way. This is why the European Commission has presented today a Communication which contains an Action Plan to enhance the efficiency and competitiveness of Europe’s defence and security sector. The Communication foresees measures to strengthen the internal market for defence, to promote a more competitive defence industry and to foster synergies between civil and military research. Besides these, the Communication also explores options in other areas such as energy, space and dual-use capabilities. The Commission invites Heads of State and Government to discuss this Communication at the European Council in December 2013, together with the report prepared by the High Representative of the Union for Foreign Affairs and Security Policy. (MEMO/13/722)

President of the European Commission José Manuel Barroso said: "We will not have the weight we need in the world without a common defence policy. To support it, we need to strengthen our defence and security sector. In times of scarce resources, cooperation is key and we need to match ambitions and resources to avoid duplication of programmes. It's time to do more together and it's time to commit and engage for more Defence cooperation. This is what I am looking forward to seeing at the European Council in December".

European Commission Vice President Antonio Tajani, Commissioner for Industry and Entrepreneurship, said: "There are some severe challenges facing Europe's defence industry and industrial base which is being undermined by the lack of new programmes. If Europe is to retain the industrial capability to meet our future military capability needs, and so underpin a credible Common Security and Defence Policy (CSDP), concerted European action needs to be taken. It is also clear that tackling industrial and market issues will only have a limited impact if there is no substantive European agreement. It is vital that European defence industry remains a world-leading centre for manufacturing and innovation, creating highly qualified jobs and growth. This is the ambition of the plan which we presented today".

Commissioner for Internal Market and Services Michel Barnier said: “Europe needs a credible CSDP to guarantee its own security and to assume its responsibilities in the world. To make this CSDP effective, we must also strengthen our defence industries and markets. In particular in times of budget constraints, this necessitates more cooperation and integration in order to become more efficient. Defence is still a domain of national sovereignty, and Member States are naturally in lead on this endeavour. However, the Commission can support them and mobilise its policies to strengthen the sector. The present Communication clearly illustrates this. It will contribute to the European Council of December and guide our action in the years to come”.

High Representative of the Union for Foreign Affairs and Security Policy / Vice-President of the Commission Catherine Ashton, said: "The EU has the ambition to act as a security provider, in its neighbourhood and globally, both to protect its own interests and contribute to international peace and security. To be able to do so, we need capabilities. And to have capabilities, a sound industrial base is vital. This is also important in terms of jobs, growth and innovation. The European Council of December 2013 is a important moment to discuss the future of security and defence in Europe, and the Commission is making an important contribution to what needs to be a collective effort involving Member States, the EEAS and the European Defence Agency."

Why does action have to be taken by the EU?

It is clear that developing and maintaining the critical technologies and capabilities required for the future is beyond the capacity of Member States to achieve individually. While defence and security remain primarily a matter for national competence the Commission believes that more can be done to promote European co-operation.

This is particularly important since the current crisis hits hard an industry which is of strategic importance for Europe as a whole. It is also a major industrial sector with a turnover of €96 billion in 2012 alone, employing about 400,000 people and generating up to another 960,000 indirect jobs. Its cutting-edge research has created important indirect effects in other sectors, such as electronics, space and civil aviation and provides growth and thousands of highly skilled jobs.

To foster cooperation and enhance the efficiency of the sector, the Commission intents to take the following initiatives:

1. Accomplish the internal market for defence and security. Based on the two existing Directives on defence procurement and intra EU defence transfers (IP/07/1860), the Commission will also tackle market distortions and contribute to improving security of supply between Member States.

2. Strengthen the competitiveness of European industry. To this end, the Commission will develop a defence industrial policy based on two key strands:

- Support for competitiveness – including developing 'hybrid standards' to benefit security and defence markets and examining the ways to develop a European certification system for military airworthiness.

- Support for SMEs – including development of a European Strategic Cluster Partnership to provide links with other clusters and support defence-related SMEs in global competition.

3. Exploit civilian military synergies. Exploit civilian military synergies to the maximum extent possible in order to ensure the most efficient use of European tax payers' resources. In particular by:

- concentrating its efforts on possible cross-fertilisation between civil and military research and the dual-use potential of space;

- helping armed forces reduce their energy consumption.

4. Exploring new avenues. Drive the strategic debate in Europe forward and prepare the ground for more and deeper European cooperation. In particular by:

- Assessing the possibility of EU-owned dual-use capabilities, which may in certain security areas complement national capabilities and become effective and cost-efficient force multipliers;

- Propose ways to support CSDP-related research in those areas where EU defence capabilities are most needed.

Background - Who would benefit and how?

Member States will save time and money through European standards and certification, supporting clusters, role specialisation, joint research and procurement, more energy efficient armies and efficient use of spatial infrastructures.

European defence-related companies, including SMEs, will gain from: Better access to other markets, either within or outside of the EU, economies of scale through more standardisation and certification and improved access to EU funding.

European tax payers will benefit from: More efficient defence spending, less duplication between R&D civil and military efforts, a more efficient use of space infrastructure and The environment will benefit from the reduced energy footprint by Europe’s armed forces.

The Communication will be the Commission's contribution to the upcoming European Council debate on defence in December 2013, in line with the Council Conclusions of 14 December 2012. In October 2012 the Commission announced that it would prepare a Strategy for Europe's defence sector. The Commission's Defence Task Force, established in 2011, is playing a key role in this process and the European Defence Agency (EDA) and European External Action Service (EEAS) are closely associated with the Task Force's work.